$A holds gains with consumer confidence boost

The Australian dollar has held onto its overnight gains after concern about a fall in domestic home loan approvals was offset by a boost in consumer confidence.

At 12.00pm AEDT on Wednesday the currency was trading at 103.21 US cents, up from 102.83 cents on Tuesday afternoon.

CMC Markets foreign exchange dealer Tim Waterer said the Australian dollar stood its ground following the release of Westpac's consumer sentiment index for February, and official home loan figures for January.

The Australian Bureau of Statistics said home loan approvals fell 1.5 per cent in January, but negativity surrounding the fall was offset by a two per cent rise in the consumer sentiment index.

"That's sort of helping the Australian dollar to consolidate its gains from overnight," he said.

Mr Waterer said the Australian dollar pushed above 103 US cents overnight due to a rise in commodity prices and a belief among traders that the recent selloff in the currency had gone too far.

He said the currency was likely to trade between 102.70 US cent and 103.70 US cents over the next 24 hours, ahead of the release of key domestic employment figures for February on Thursday.

"In terms of where it heads from here, any significant moves will be reserved for after we see the labour force figures," he said.